A report released Oct. 8 by the U.S. Citizenship & Immigration Services (USCIS) reveals that 13% of petitions filed for H-1B visas on behalf of employers are fraudulent. Another 7% contain some sort of technical violations.

The study, released to members of the U.S. Senate Judiciary Committee, marks the first time the agency, part of the Homeland Security Dept., has documented systematic problems with the controversial program. Technology companies, in particular, have come to rely on the H-1B visa program to bring in skilled foreign workers to fill jobs that employers claim can’t be filled with U.S. candidates. Tech companies like Oracle (ORCL), Microsoft (MSFT), and Google (GOOG) have pushed to get more visas, claiming that a shortage of skilled workers is hampering U.S. competitiveness. Microsoft Chairman and co-founder Bill Gates has twice testified in front of Congress on the issue.

Critics say H-1Bs help U.S. companies replace American workers with less costly foreign workers. “The report makes it clear that the H-1B program is rife with abuse and misuse,” says Ron Hira, assistant professor of public policy at the Rochester Institute of Technology. “It shows the desperate need for an auditing system.” However, both Presidential candidates, Senator Barack Obama (D-Ill.) and Senator John McCain (R-Ariz.), have said they support expanding the program.

Program Abuses Alleged

A USCIS spokesperson was not immediately available for comment. The report’s conclusion states: “Given the significant vulnerability, USCIS is making procedural changes, which will be described in a forthcoming document.” A spokeswoman, Beth Pellett Levine, says Senator Chuck Grassley (R-Iowa), a longtime critic of the H-1B program, is drafting a letter to USCIS in response to the study.

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There is also evidence that workers on H-1B visas are being mistreated. In a pending case (BusinessWeek, 1/31/08), H-1B workers for State Farm Insurance allege they were underpaid.

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Fraudulent cases include instances in which the visa worker was not working or had never worked at the specified location on the application. Technical violations involved situations in which the worker was paid at or below the prevailing wage, which companies are required by law to pay.

In other cases, the job duties were significantly different from the position listed on the visa petition. This could involve misrepresenting the skill set required or the location of the job. {snip}

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